Medicaid Expansion: An Opportunity to Address the Social Determinants of Health

June 07, 2018|10:34 a.m.| ASTHO Staff

On May 30, the Virginia Senate by a vote of 23-17 and the House of Delegates by a vote of 67-31 approved the expansion of the state’s Medicaid program. With Gov. Ralph Northam expected to approve the legislation, the commonwealth is poised to become the 33rd state to expand its Medicaid program to cover an estimated additional 400,000 low-income adults with incomes up to 138 percent of the federal poverty level (FPL), which is an annual income of no more than $16,753 for a one-person household. The bill authorized the expansion of Medicaid and included provisions requiring the state to submit a waiver to CMS establishing work requirements and cost-sharing requirements for the state’s Medicaid expansion population. If approved by CMS and implemented, Virginia will become the fifth state with work requirements in its Medicaid expansion program, joining Arkansas, Indiana, Kentucky, and New Hampshire.

Virginia’s Medicaid expansion presents an opportunity to reinforce the importance of addressing the social determinants of health (SDoH) among Medicaid beneficiaries including social and behavioral health issues that affect their health status and contribute to high healthcare utilization and spending. Moreover, critics have asserted that Medicaid work requirements—rather than improving economic opportunity for low-income people—will actually worsen health-related social needs because Medicaid members won’t be able to meet the requirements and, as a result, will have limited access to continuous coverage and preventive care. Interventions that address SDoH, such as coverage for transportation or housing support services, can improve the ability of low-income people to find and maintain employment, reducing “churn” in and out of the Medicaid program, and potentially leading to sustained employment and a way out of poverty.

A recent Commonwealth Fund report underscores this population’s complex needs by highlighting Minnesota’s experience expanding Medicaid and addressing new enrollees’ urgent demand for services. The report researched the medical and social needs of the poorest expansion enrollees with incomes below 75 percent of FPL, which encompasses people with annual incomes of no more than $9,105 for a one-person household in 2018. The report highlighted high rates of unstable housing, substance use, and mental illness among these very poor enrollees: More than 25 percent of the studied population experienced two or more of these issues, and 10 percent experienced all three. In other words, 25 percent of the poorest enrollees have complex and profound health and social needs.

The report also found that among individuals with high levels of behavioral health needs, health insurance coverage is critical to maintaining continuation of care and, without coverage, these individuals face difficulties in managing underlying chronic physical health conditions. For example, individuals with mental illness or substance use disorders are at increased risk for developing diabetes, and behavioral health issues can worsen complications and symptoms. Difficulty managing physical and behavioral health conditions is also likely to impact an individual’s ability to sustain employment or regular commitments, which may frustrate the very work and community engagement requirements proposed for Medicaid eligibility. Preventive and acute medical care that integrates services that address enrollees’ health-related social needs, such as case management and supportive housing services, may help to prevent additional downstream healthcare spending.

States that are seeking work requirements for expansion populations to improve beneficiaries’ economic status may be well served by an additional consideration: put forward a public health approach to SDoH that creates healthy and economically strong communities and offers linkages between health and social services, ultimately improving overall health and well-being for individuals and communities.

Many states are already working to improve access to health-related social needs using various Medicaid levers, such as implementing requirements for managed care organizations to screen for and address factors related to SDoH or by incorporating individuals’ SDoH screening results into risk adjustment and rate-setting calculations. For example, Massachusetts incorporates SDoH variables for homelessness, substance use disorder, and neighborhood stress into its risk adjustment model for beneficiaries in the managed care plan. States involved in the CMS Accountable Health Communities initiative are also encouraging providers to screen Medicaid and Medicare beneficiaries for health-related social needs and create referrals to local social service providers in order to improve health outcomes and reduce healthcare costs. As leaders become more aware of the impact SDoH have on health outcomes and healthcare spending, they will likely look to address the needs of Medicaid expansion populations who face both significant health issues and health-related social needs.